Why this logjam on passing of GST?

Goods and Services Tax [GST] is defined as “any tax on supply of goods and services other than on alcohol for human consumption”. A value added tax levied all along the supply chain, it is applicable to all goods and services traded or rendered in the supply chain. With hardly any exemptions envisaged, it is designed to prevent the cascading effect of taxes. Just as in any other value added models, tax paid on inputs in its conversion into goods and services is available as a credit, to be set off against any liability under the GST Act.

Given the federal relationship between the Centre and States the GST is envisaged to be levied both by the Centre and States.[ It will be denoted as CGST and SGST respectively]. The Act as it is structured now, conceives of the levy of taxes on the basis of destination principle. Exports would have no tax-implication whereas imports will attract the same rates as is applicable to domestic goods and services. Another feature of this Act is the concept of Integrated GST [IGST] – the aggregate of the CGST and the SGST of the destination state. Besides the Act conceives of another 1% tax purely on supply of goods, to the account of the Central Government, which is proposed to assigned to the origin states

Seen as a very efficient tax regimen with a neutral disposition, it is being credited as a wider tax base and will assist in elimination the multiple-tax systems, now prevalent. It is being packaged as a harbinger of rationalisation of tax structure aimed at simplifying compliance procedures and harmonisation of Centre-State Tax Administration.

In this direction, it is befitting to state that there will be subsuming of many existing taxes like Central Excise Duty, Additional Excise Duty, Service Tax, Additional Customs Duty, Special Additional Duty, Value Added Tax [Sales Tax], Central Sales Tax, Entry Tax, Entertainment Tax, Purchase Tax, Luxury Tax and Octroi wherever in existence.